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April 4, 2016
Customers who install home energy efficiency products or equipment in 2016 may be eligible for a federal tax credit. Through the 25C tax credit, customers can get a tax credit worth up to 10% of the product cost for improving home performance – or a specific amount from $30-$300 – up to $500 in total. This tax credit is effective for products and equipment installed through December 31, 2016.
#1. Who is Eligible?
Owners of existing homes are eligible for the credit, for their own residence.
*Important: New homes and rental homes are not eligible for the 25C tax credit.
#2. What Products and Equipment Qualify?
The following energy efficiency products qualify for the 25C tax credit:
- Air source heat pumps
- Central air conditioning
- Gas, propane, or oil hot water boiler
- Water heaters (non-solar)
#3. How Do I Apply?
Customers must keep receipts and a copy of the Manufacturer's Certification Statement (a signed statement from the manufacturer certifying that the product qualifies for tax credit; usually available on manufacturers' websites). These items should be kept on file (but not submitted to the IRS unless requested).
File IRS-5695 (available at www.irs.gov) with your taxes to claim the credit.
#4. Product/equipment standards and tax credit amounts.
- New Boiler: with a 95%+ Annual Fuel Utilization Efficiency (AFUE) - $150.00
- New Furnace: with an Advanced Main Air Circulating Fan (AMACF) - $50.00
- New Furnace: with a 95%+ AFUE - $150.00 (or $200.00 if also equipped with an AMACF)
- New Central Air Conditioner: with a 16+ Seasonal Energy Efficiency Ratio (SEER) & 13+ Energy Efficiency Ratio (EER) - $300.00
- New Central Heat Pump: with a 15+ SEER, 12.5+ EER & 8.5+ Heating Seasonal Performance Factor (HSPF) - $300.00
- New Fuel-fired Water Heater: with an Energy Factor (EF) of .82+, or Thermal Efficiency (TE) of 90%+ - $300.00
- New Electric Heat Pump Water Heater: with an EF of 2.0+ - $300.00
- New Insulation: 10% of the “Materials Only” cost, up to $500.00
More information available at https://www.energystar.gov/about/federal_tax_credits/